Three Investing Rules

Reid Hoffman, the founder of LinkedIn, is also an investor in the technology world. It's worthwile to know how he looks at the investments he makes. The three criteria are mass audience, unique value, and stable funding. He points out that as entrepreneurs starting a new company, the pitch often revolves around the product, or the business plan. However, Reid cuts to the quick by looking at his key factors. The ability to grow to a million and then 10 million users is right up front. Then having a really unique product comes next, followed by being efficient with the capital. So now ask yourself the same questions. Where is your audience? Why is your product hot? And how are you burning the money?